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SURVEY: Cryptocurrencies -- wave of the future or disaster waiting to happen?


Scott

SURVEY: Cryptocurrencies -- wave of the future or disaster waiting to happen?  

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Any currency is only worth the agreed upon value from a given society. The interest in crypto is how no government has declared ownership. It's a rogue currency and a growing number of people like that.

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Just now, Thaiophil said:

I invested a reasonable amount in Jan and my portfolio is now worth 50% more than my stake. 
 

All investments carry risks and rewards

I always think of Tulip bulbs when this topic comes up.

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When Thai gold shops exchange crypto for gold i will change my mind and call it a legitimate currency...until then its a huge pump and dump Ponzi 

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It is fully correct to state that the crypto-currency proposition is based on thin air, and that its value is determined purely based on supply and demand for the 'new digital gold'.

Contrary to shares/bonds and fiat (government issued) money, Bitcoin - or any crypto-currency for that matter - is not based on a legally enforceable obligation of the borrowers.

That's also the reason that most financial (and other) organizations were reluctant to accept it, because without underlying value and solely based on supply/demand the exchange rate can both soar and dive enormously (driven by greed and speculation).

 

But in spite of the above, more and more people start to realize that the current financial system can crash (the billions that are currently printed and pumped into the economy to finance the covid-crisis are a good example that undermines the trust in our current financial system).  And so in spite of the bubble-background of crypto-currency more and more people are entering this crypto-world, making it a self-fulfilling prophecy.  My own brother, who had not the slightest idea of how Bitcoin actually worked made quite a killing by stepping in early.

And with big mainstream organizations now starting to accept Bitcoin (Tesla, MasterCard, institutional investors) then the flood-gates are really opened, and the 'value' (driven by the demand of  those that are currently stepping in) will only raise.


One of the main obstacles that prevented people from going for it, is the high techno-nerd crypto-world with many con-sharks swimming the waters.  But there are now also well-trusted financial organizations that allow people to buy crypto quick-and-easy.

So if you like a gamble - which almost certainly will turn out positive - it is not too late to go for it.

But of course you should only 'invest' (gamble is a better word) what you can afford to lose, and limiting crypto to max 10% of your portfolio is therefore a wise advice.

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I thought about buying crypto ... I did not do it .

Of course , I could have made some ' easy money ' by now .

But I already have enough for my needs .

And , the older I get , I do not feel the need for always ' more ' ...

And I would hate the idea of losing what I have , due to my greed of owning more than I need ...

This crypto boom is , after all , backed by nothing but the limited availability and someones greed .

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I made seven figures USD on Bitcoin and Ethereum in the last 12 months from a fairly modest investment. To those saying that it is a ponzi or a fad, or only backed by greed, I suggest you educate yourself very quickly, or you'll be left behind. You can start by reading or listening to The Bitcoin Standard by Safedean Ammous. 

 

Microstrategy and Tesla have invested, Apple and Google will be next, and you are still sitting there without any Bitcoin? 😆

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Many 'serious' investors recognize the volatility and risks and recommend no more than 1% of your portfolio is invested........I have a suspicion the 1% recommendation might have increased of late.

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US Dollar -

Inflationary (25% of total supply printed in the last 12 months)

Backed by nothing but Govt. promises and debt

Controlled by a centralized authority (in this case the US Govt. and you really trust them?)

Can be seized / frozen by authorities at any time

Doesn't really belong to you unless it is in your pocket or possession (and you can't carry that much of it around all the time so you have to trust banks)

Need banks or third party to transfer over distance

Used by criminals because its fairly untraceable

Can be stolen easily (physical robbery, theft, etc.)

 

Bitcoin - 

Capped supply of 21 million (there will never be more)

Backed by the biggest network in the World (the internet of money)

Not controlled by anyone

You directly own and are responsible for your own funds (no need to trust a third party)

Extremely hard to steal from someone

No banks or third parties required

Can be used as a totally secure store of value

Can send almost instantly to anyone anywhere in the World without the need for a third party

Trust-less (no need to trust anyone else)

Network can never be taken offline, hacked or stopped

Pseudonymous (similar to an IP address)

All transactions are recorded on an immutable ledger (no good for criminals)

 

It's a no brainer and the future of money. 

 

 

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18 minutes ago, nobodysfriend said:

I thought about buying crypto ... I did not do it .

Of course , I could have made some ' easy money ' by now .

But I already have enough for my needs .

And , the older I get , I do not feel the need for always ' more ' ...

And I would hate the idea of losing what I have , due to my greed of owning more than I need ...

This crypto boom is , after all , backed by nothing but the limited availability and someones greed .

 

I'm with you on this, I would rather not earn on my investments for a year or two as opposed to going into something that is high risk and volatile, sure some can make a killing, but those that seek high returns, seldom walk away unscathed when it goes down as quick as it went up.

 

Money on stocks and money in the bank is there, it's real, if they perish, then a hell of a lot of us would be in the same boat, in other words, my balls are not big enough to try Bitcoin, an income to meet my budget as it's done for the past 5 years is fine by me, no grown, but no decline, and the way I see it, I have, if lucky, another decade to go, so why not leave something (a lot) for the kids futures as they will all need a leg up.

 

 

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One of our crypto fans on this forum led me to an exchange traded fund that is linked to the price of bitcoin and ethereum... 

 

I still do not understand much about what and how, but I do believe that it is becoming more mainstream and so I took, not so much a plunge... but a 1% joy ride... and even w/that, based on the large degree of fluctuation, it is the elephant in my portfolio... 

 

I think the closing over 50k might spark a rally - - 

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2 minutes ago, 4MyEgo said:

 

I'm with you on this, I would rather not earn on my investments for a year or two as opposed to going into something that is high risk and volatile, sure some can make a killing, but those that seek high returns, seldom walk away unscathed when it goes down as quick as it went up.

 

Money on stocks and money in the bank is there, it's real, if they perish, then a hell of a lot of us would be in the same boat, in other words, my balls are not big enough to try Bitcoin, an income to meet my budget as it's done for the past 5 years is fine by me, no grown, but no decline, and the way I see it, I have, if lucky, another decade to go, so why not leave something (a lot) for the kids futures as they will all need a leg up.

 

 

It is not an all or nothing game.....people seem to be obsessed by the idea that if you invest in crypto you are all in......live or die....no single investment should concern you/damage you if it sudden goes titß up.....put in an amount you are comfortable losing......if it goes up 400% happy days.

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As usual, many of the posts here show a misunderstanding of what Bitcoin is, but that is fine. Enough people take the time to think more deeply and see past the reflexive tropes. The instant someone mentions tulips or ponzi schemes or "Why can't I use it to buy beer/gold/burgers?", you know that they have been too lazy to understand what Bitcoin actually is.

In March I suggested, in this forum, that Bitcoin was a terrific deal at 5k and heard all the same tired old arguments. It is pointless trying to argue a point with someone who does not want to understand how the world around them is changing.

The survey is about crypto in general, but my observations are confined to Bitcoin and Ethereum. There are undoubtedly other good coins but most alt-coins are nonsense. If you are only starting to get into crypto I presume your primary interest is in increasing your money. For this year, at least, Bitcoin and, to a lesser extent, Ethereum are your best investment.

The current world economic situation is unique. No secret has been made that most governments plan to print their way out of this mess. Indeed, they have been doing variations of this since 9/11 when Alan Greenspan dramatically reversed his previous antipathy towards printing money. It has, ever since, been the crutch that has kept the global economy moving and, as result, asset and commodity prices skyrocketed.

So, we know what is happening, and we have 20 years of experience to tell us what the natural consequence will be. When you flood the system, money rushes into every form of asset - property, shares, metals, bonds, patents, startups, crypto etc. All assets will continue to gain in 2021 but Bitcoin will handily outpace them because, again, it is the best match to this unique situation.

For the past decade, Bitcoin has been a good long-term bet but the increases in value have occured in unpredictable spurts. In 2020, Covid and our reaction to it changed everything.

After the initial crash (of everything) in March, Bitcoin's growth became far more predictable because the reasons for it became more obvious. Also, as an increasing number of companies and financial institutions adopted Bitcoin as a hedge against dollar debasement, the falls in value became less severe.

As this year continue to unfolds, we will see, each month, a few periods of growth in the value of Bitcoin, probably usually gaining around 10k in a week before falling back and settling at around 5k above its previous price. There may be a few heavier corrections but, by the end of 2021, we are going to watch it break 200k. The media story around Bitcoin will also be far more positive, with far more mainstream acceptance manifesting on several levels.

 

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10 minutes ago, Mr Meeseeks said:

I made seven figures USD on Bitcoin and Ethereum in the last 12 months from a fairly modest investment. To those saying that it is a ponzi or a fad, or only backed by greed, I suggest you educate yourself very quickly, or you'll be left behind. You can start by reading or listening to The Bitcoin Standard by Safedean Ammous. 

 

Microstrategy and Tesla have invested, Apple and Google will be next, and you are still sitting there without any Bitcoin? 😆

Good for you, but there are of course also other considerations why some people - although well aware of the huge potential for a Quick Buck - do not step into it.

Two of the main reasons why I have till now refrained from jumping on the Bitcoin bandwagon are:

1 - The staggering amount of energy needed to keep the whole Bitcoin-system in the air;

2 - The gains made by those that stepped in early are 'financed' by those stepping in later.  Or in other words, my gain will be the loss of someone else.

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Just now, 1FinickyOne said:

One of our crypto fans on this forum led me to an exchange traded fund that is linked to the price of bitcoin and ethereum... 

 

I still do not understand much about what and how, but I do believe that it is becoming more mainstream and so I took, not so much a plunge... but a 1% joy ride... and even w/that, based on the large degree of fluctuation, it is the elephant in my portfolio... 

 

I think the closing over 50k might spark a rally - - 

Bitcoin will go to six figures this year, and my prediction is $300k by end 2023. Some are saying $1m by then.

 

I actually predicted $30k in June 2021, so it has outshone my expectations. 

 

Now that institutional money has arrived, there's no stopping the juggernaut. You have to remember they are buying more Bitcoin than is being mined, and they are holding, which means less coins for the rest of us. 15,000 BTC are being removed from Coinbase every week... and being accumulated by those in the know.

 

To become a wholecoiner (own at least one whole Bitcoin) puts you in an elite group of people of only 800,000 Worldwide and we are just getting started. 

 

One point of note, it is always better to actually own the Bitcoin or crypto yourself, rather than trust a third party but welcome aboard anyhow!

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1 minute ago, Peter Denis said:

2 - The gains made by those that stepped in early are 'financed' by those stepping in later.  Or in other words, my gain will be the loss of someone else.

Isn't that true of (almost) every investment vehicle?

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2 minutes ago, Mr Meeseeks said:

One point of note, it is always better to actually own the Bitcoin or crypto yourself, rather than trust a third party but welcome aboard anyhow!

Yes...keep mine on a Nano Ledger.....now what was that password?

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3 minutes ago, fangless said:

Tell that to the Burmese, Chinese etc!

The network cannot be taken offline, regardless of what authoritarian governments attempt to do, and that is one of the reasons Bitcoin is such an attractive investment. 

 

I'd be far more worried about holding Kip or Yuan in those countries. 

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9 minutes ago, Peter Denis said:

Good for you, but there are of course also other considerations why some people - although well aware of the huge potential for a Quick Buck - do not step into it.

Two of the main reasons why I have till now refrained from jumping on the Bitcoin bandwagon are:

1 - The staggering amount of energy needed to keep the whole Bitcoin-system in the air;

2 - The gains made by those that stepped in early are 'financed' by those stepping in later.  Or in other words, my gain will be the loss of someone else.

“The notion that Bitcoin is wasting unnecessary energy is false – Bitcoin is more often than not using surplus energy that is expended whether or not it is put to use. Energy generators operate under peak capacity, meaning that there is often too much energy produced in case of a surge in energy demand.”

When compared with the energy consumption of the legacy financial system, according to the report, Bitcoin is on par with gold mining. Bitcoin’s 0.27% share of the entire world’s electricity expenditure equals gold’s crude oil usage for mining: 0.27%.

https://dailyhodl.com/2020/01/04/new-report-busts-major-bitcoin-myths-electricity-and-illicit-activity/

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13 minutes ago, Peter Denis said:

1 - The staggering amount of energy needed to keep the whole Bitcoin-system in the air;


The energy is being used, essentially, to record the transactions. The Visa or Mastercard systems would use an equivalent amount of energy per transaction.

No form of electronic transaction is as energy-expensive as printing banks notes and running networks of banks staffed by humans, all of whom run homes, and fueling the world's roughly 3.5 millions ATMs, and maintaining fleets of armored security vans for end-of-day cash pickups etc.

Think, too, about the amount of time, money, and energy wasted on preventing or dealing with the consequences of how easy it is to counterfeit paper money and gold. Bitcoin's way of recording transactions makes it impossible to counterfeit.

The websites publishing these clickbait articles about the energy Bitcoin uses all use servers, and all knowingly add tracking Javascript and other nonsense to their sites that cause your device to use more electricity than any webpage should require.

Fusing the current era's enviro-panic with the sense of resentment against those who made money from Bitcoin is a guaranteed way to generate traffic. Same as publishing articles about how bad Apple is. Nonsense, but highly profitable nonsense.

 

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3 minutes ago, Surelynot said:

Isn't that true of (almost) every investment vehicle?

When trading to making profits from exchange rate or stock value fluctuations, that's correct (your gain is another person's loss). 

But that's not the case when buying shares in a healthy company providing a product/service that is in demand.  In that case it is a win-win scenario both for yourself and the company.

The company gets access to funds it needs to finance its future projects and growth.

And you get a reward for the risk you are taking by investing your funds in their company, in the form of increased share-value as a result of them doing their business successfully.

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9 minutes ago, Surelynot said:

Isn't that true of (almost) every investment vehicle?

The beauty of Bitcoin is that it is engineered to provide value to the holders.

 

As the network grows, so does the mining difficulty increase, that is to say, the rewards for performing functions on the network decrease over time. 

 

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bitcoin, was it not invented & intended, not to be used by big banks that control the economy or rather the private company that prints the money for the government and ask interest for it, that can never be re-paid and the main reason people HAVE to pay taxes

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51 minutes ago, Peter Denis said:

2 - The gains made by those that stepped in early are 'financed' by those stepping in later.  Or in other words, my gain will be the loss of someone else.


That is not true. Early investors in Google, or Apple, or the vast majority of companies are richly rewarded because they spot the value long before most other people. Their early support allowed companies to be created that will create value, for everyone, for decades (possibly even centuries) to come.

The people who launched Bitcoin in 2009 did so at the tail-end of a decade during which Alan Greenspan flipped US policy to massive money-printing. Bitcoin was invented as a direct response to dollar debasement. They spotted, earlier than most, where all this was going. Bitcoin, the world's favorite non-inflationary currency, is the solution to the dollar debasement. That is about to become very important, and that is why those who invest this year and next year will be handsomely rewarded as it continues to go mainstream.

Bitcoin is useful because only Bitcoin can be used for certain things. Decentralized money acts as a counterweight as cash is phased out and the official money systems become increasingly controlled. The families who used it to get their money out of Venezuela or China gained massively, because their alternative was the evaporation of their savings.

Now the main use is that every company holding dollars knows those dollar will lose a significant chunk of value by the end of this year. Putting a portion of their cash holdings into Bitcoin means they have a better chance of not losing value. At the very least, they know exactly how many Bitcoins exist and exactly how many will ever exist. They also know that they can instantly convert it back into money as soon as they need it. That functionality is of real use to them. The usefulness will increase exponentially as it becomes a standard tool for corporations and becomes further integrated into their processes and systems.

The value of Bitcoin will stabilize as this ultimate use becomes clearer and as almost all Bitcoin in existence are gradually acquired and held permanently by the major companies and finance houses.

 

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9 minutes ago, Mr Meeseeks said:

“The notion that Bitcoin is wasting unnecessary energy is false – Bitcoin is more often than not using surplus energy that is expended whether or not it is put to use. Energy generators operate under peak capacity, meaning that there is often too much energy produced in case of a surge in energy demand.”

...

The notion that Bitcoin miners would 'more often than not' be using surplus energy for their mining operations, is correct.  Their mining takes so much energy that they do look for locations where they can do this at lowest cost.  But bitcoin-mining and keeping the whole bitcoin-system in the air is surely not a 'green' operation.

 

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